CIMA Advanced Management Accounting P2 Question # 4 Topic 1 Discussion

CIMA Advanced Management Accounting P2 Question # 4 Topic 1 Discussion

P2 Exam Topic 1 Question 4 Discussion:
Question #: 4
Topic #: 1

To which technique for dealing with risk and uncertainty do ALL of the following statements apply?

• It requires that only one factor is considered at a time.

• It identifies areas which are crucial to a project, which can then be monitored if the project is chosen.

• It does not provide an indication of the likelihood of any change in the factors.

• Following the calculation, it requires the exercising of judgement to decide whether to accept or reject a project.


A.

Sensitivity analysis


B.

Probability analysis


C.

Scenario analysis


D.

Adjusting the discount rate to reflect risk.


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